Published on 2/21/2019 in the Prospect News Investment Grade Daily.
New Issue: Boston Scientific prices $4.3 billion of senior notes in five parts
By Cristal Cody
Tupelo, Miss., Feb. 21 – Boston Scientific Corp. priced $4.3 billion of senior notes (Baa2/BBB-/BBB) in five tranches on Thursday, according to a market source and an FWP filed with the Securities and Exchange Commission.
An $850 million tranche of 3.45% five-year notes priced at 99.94 to yield 3.463% and a spread of Treasuries plus 95 basis points.
The company sold $850 million of 3.75% seven-year notes at 99.724 to yield 3.795%. The notes priced with a spread of 120 bps over Treasuries.
In the 10-year tranche, the company priced $850 million of 4% notes at 99.664 to yield 4.041%, or a spread of 135 bps over Treasuries.
Boston Scientific priced $750 million of 4.55% 20-year notes at 99.44 to yield 4.593%. The notes were sold with a spread of 155 bps over Treasuries.
Finally, the company sold $1 billion of 4.7% 30-year notes at a spread of Treasuries plus 170 bps. The notes priced at 99.314 to yield 4.743%.
The tranches came on the tight side of guidance and better than initial talk.
Barclays, BofA Merrill Lynch, Wells Fargo Securities LLC, Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Goldman Sachs & Co. LLC and J.P. Morgan Securities LLC were the bookrunners.
Proceeds will be used to fund some of the company's planned acquisition of BTG plc, to redeem its $850 million of 6% notes due January 2020 and $600 million of 2.85% notes due May 2020, to repay debt under its $1 billion term loan facility due August 2019 and to repay other short-term debt.
Boston Scientific is a medical device maker based in Marlborough, Mass.
| Issuer: | Boston Scientific Corp.
|
| Amount: | $4.3 billion
|
| Description: | Senior notes
|
| Bookrunners: | Barclays, BofA Merrill Lynch, Wells Fargo Securities LLC, Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Goldman Sachs & Co. LLC and J.P. Morgan Securities LLC
|
| Co-managers: | Academy Securities, Inc., BNP Paribas Securities Corp., DNB Markets, Inc., MUFG, RBC Capital Markets, LLC, Scotia Capital (USA) Inc., SG Americas Securities, LLC, Standard Chartered Bank, TD Securities (USA) LLC and U.S. Bancorp Investments, Inc.
|
| Trade date: | Feb. 21
|
| Settlement date: | Feb. 25
|
| Ratings: | Moody’s: Baa2
|
| S&P: BBB-
|
| Fitch: BBB
|
| Distribution: | SEC registered
|
|
|
| Five-year notes
|
| Amount: | $850 million
|
| Maturity: | March 1, 2024
|
| Coupon: | 3.45%
|
| Price: | 99.94
|
| Yield: | 3.463%
|
| Spread: | Treasuries plus 95 bps
|
| Call features: | Make-whole call at Treasuries plus 15 bps; special mandatory redemption at 101 if BTG plc acquisition is terminated
|
| Price guidance: | Treasuries plus 100 bps area, plus or minus 5 bps; initial talk at 120 bps spread area
|
|
|
| Seven-year notes
|
| Amount: | $850 million
|
| Maturity: | March 1, 2026
|
| Coupon: | 3.75%
|
| Price: | 99.724
|
| Yield: | 3.795%
|
| Spread: | Treasuries plus 120 bps
|
| Call features: | Make-whole call at Treasuries plus 20 bps; special mandatory redemption at 101 if BTG plc acquisition is terminated
|
| Price guidance: | Treasuries plus 125 bps area, plus or minus 5 bps; initial talk at 140 bps spread area
|
|
|
| 10-year notes
|
| Amount: | $850 million
|
| Maturity: | March 1, 2029
|
| Coupon: | 4%
|
| Price: | 99.664
|
| Yield: | 4.041%
|
| Spread: | Treasuries plus 135 bps
|
| Call feature: | Make-whole call at Treasuries plus 25 bps
|
| Price guidance: | Treasuries plus 140 bps area, plus or minus 5 bps; initial talk at 155 bps spread area
|
|
|
| 20-year notes
|
| Amount: | $750 million
|
| Maturity: | March 1, 2039
|
| Coupon: | 4.55%
|
| Price: | 99.44
|
| Yield: | 4.593%
|
| Spread: | Treasuries plus 155 bps
|
| Call feature: | Make-whole call at Treasuries plus 25 bps
|
| Price guidance: | Treasuries plus 160 bps area, plus or minus 5 bps; initial talk at 180 bps spread area
|
|
|
| 30-year notes
|
| Amount: | $1 billion
|
| Maturity: | March 1, 2049
|
| Coupon: | 4.7%
|
| Price: | 99.314
|
| Yield: | 4.743%
|
| Spread: | Treasuries plus 170 bps
|
| Call feature: | Make-whole call at Treasuries plus 30 bps
|
| Price guidance: | Treasuries plus 175 bps area, plus or minus 5 bps; initial talk at 190 bps spread area
|
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